The 3 Best Green Energy Stocks to Buy for the Next Decade

Green energy stocks are some of the best long-term investments you can make today. Here are some of the best stocks in the renewable energy industry.

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It’s no secret that green energy stocks are some of the best long-term growth stocks you can buy today.

If you just look at the sector, green energy stocks have been some of the best performers over the last few years. Plus, in addition to the stock performance, renewable energy is increasingly becoming a priority for governments all over the world.

Continuous evidence of worsening climate change coupled with a rapid improvement in the technology and costs of green energy has given the sector a huge boost.

Last year, Europe, for the first time, consumed more electricity from renewable sources than fossil fuels. Yet still, in order to reach climate targets, the Europeans have to increase their electricity from renewable sources by another 100%. A 100% increase would put Europe in line to meet its 1990 target of reducing emissions by 55% ahead of 2030.

In North America, green energy will also see a significant boost over the next few years, especially with Joe Biden taking office as president. He has listed a massive green energy infrastructure as one of the top issues on his agenda.

So, with all this potential for decades of growth, here are the three best green energy stocks to buy today.

An ultra-safe green energy dividend stock

While green energy stocks are some of the best investments to make today, we need to ensure they fit well in our portfolios. With all the uncertainty in markets today, it’s crucial to have just as many resilient stocks as it is to have growth.

Therefore, if you have a lot of growth stocks and are looking for a more defensive stock, the ideal green energy stock to consider is Algonquin Power and Utilities (TSX:AQN)(NYSE:AQN).

Algonquin offers much of the same upside as the rest of the green energy industry. However, two-thirds of its current operating income come from its stable utilities business. This makes Algonquin more ideal for lower-risk investors looking for a steady dividend stream.

The company is one of the most attractive Dividend Aristocrats you can buy. So, with its 3.5% dividend, low-volatility stock, and incredible long-term growth potential, it’s one of the best Canadian companies you can buy today, let alone one of the best green energy stocks.

High-growth renewable energy generator

Investors who may not need as much stability should consider a company like Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP). Brookfield is not a risky stock. It’s just not ultra-safe like Algonquin. However, the stock does offer considerably more growth potential over the next few decades.

Brookfield is the largest green energy stock in Canada, with nearly 9,000 megawatts of generation capacity and assets all over the world. It’s also one of the fastest-growing green energy stocks too, up 80% over the last year.

One of the most significant benefits Brookfield possesses is its massive size and financial position. This puts it in a prime position going forward over the next few years to continue to build out its business as green energy projects grow in popularity.

Plus, on top of all the growth potential, it also returns cash to shareholders through its dividend, which currently yields 2.6%.

Rapidly growing industrial green energy stock

Lastly is another high-potential and unique way to play the boom in renewable energy. Xebec Adsorption (TSX:XBC) is a rapidly growing company that makes industrial equipment to help businesses reduce their carbon footprints.

Some of its earliest technology helps capture naturally occurring raw gasses and transforms them into hydrogen or renewable natural gas. It’s also made a tonne of accretive acquisition, building out its business as one of the top industrial equipment makers in the renewable energy space.

This impressive performance by the green energy stock hasn’t gone unnoticed by investors, though. Xebec stock is up roughly 200% over the last 12 months.

And going forward, as the technology improves and the demand for these products skyrocket, Xebec is poised to be one of the top-performing companies in the renewable energy sector.

Bottom line

Green energy stocks present investors massive opportunities for decades. There are several high-quality renewable stocks you can buy today. These are just three of the very best.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Daniel Da Costa owns shares of XBC and ALGONQUIN POWER AND UTILITIES CORP.

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